Goods and Services Tax : From April 1, 2025, ISD registration becomes mandatory for ITC distribution among GSTINs, replacing the cross-charge mechanism for...
Goods and Services Tax : From April 1, 2025, ISD registration under GST is mandatory for distributing input service ITC across branches. Applies only to se...
Goods and Services Tax : Learn how to handle discrepancies in GSTR-2A and GSTR-3B for FY 2017-18 to 2018-19 under CGST Act 2017. Explore scenarios, clarifi...
Goods and Services Tax : 1. The concept of Input Service Distributor (ISD) has its roots in the service tax regime. The Head office of an organization obta...
Goods and Services Tax : Articles explains Conditions to avail Input tax credit under GST, Important Points related to Input tax credit under GST, Input T...
Goods and Services Tax : Changes are being made in the credit utilization criteria in Form GSTR-6, filed by Input Service Distributors (ISDs). These change...
Goods and Services Tax : Department of Revenue has agreed to most of the recommendations put forward by Empowered committee in FDP on GST relating to harmo...
Service Tax : The three services qualifying for service tax refund are courier services, goods transport agency services availed for transport o...
Service Tax : Government has issued Notification No. 3/2008-ST, dated 19.02.2008, extending the scheme to refund service tax paid by exporters o...
Goods and Services Tax : The Court held that the amendment to Rule 89(5) is clarificatory and applies retrospectively to earlier refund claims. Refund deni...
Goods and Services Tax : The ruling examines whether construction services for machinery foundations qualify for ITC. It holds that such foundations are in...
Excise Duty : CESTAT Ahmedabad held that services availed in respect of effluent treatment plant for treatment of industrial waste is in relatio...
Excise Duty : In the case of Commissioner of Central Excise, Ludhiana vs DRP Malleables Pvt. Ltd. (supra), the Tribunal held that Chartered Acco...
Excise Duty : CENVAT Credit on Canteen Services and House Keeping/Cleaning Services availed in office building are admissible to Assessee when s...
Service Tax : In the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 7/2010-Central Excise (Non...
Service Tax : CENVAT Credit Rules, 2004 permit taking of credit of inputs and input services which are used for providing output services or out...
Service Tax : Trade Notice No. 14/2009 Prior to 01.04.2008 [before the amendment in Rule 6(3)] the option available to the taxpayer, under Rule...
Department of Revenue has agreed to most of the recommendations put forward by Empowered committee in FDP on GST relating to harmonious structure of rate, taxation base, exemptions, chargeability, definition of taxable event, taxable person, valuation, classification etc.However, there are certain areas where Department of Revenue has suggested changes or deviated from FDP. The said areas of differences are discussed below:
The recent circular no. 120/01/2010-ST dated January 19, 2010 has been issued by the Board for claiming the refund of unutilized Cenvat credit under Rule 5 of Cenvat credit Rules by the service exporters. The above circular has tried to address all the problems faced by the service tax exporters in claiming such exemption. They have tried to give clarification on all the issues. But the famous Hindi proverb “lohe ke chane chabana” (Hard nut to crack) is apt for refund claim for the exporters under Notification 41/2007 or refund under Rule 5.
In order to make exports of services from India internationally competitive, the Government of India has zero rated such exports. Consequently, the services exporting community is entitled to obtain refunds of input tax credits or utilise such credits to offset domestic output service taxes. The IT and the ITES industry is a key part of the service exporting community and was expected to be a major beneficiary of such refunds in terms of being competitive in the global marketplace.
CENVAT Credit Rules, 2004 permit taking of credit of inputs and input services which are used for providing output services or output goods. In order to zero-rate the exports, Rule 5 of CENVAT Credit Rules, 2004 provides that such accumulated credit can be refunded to the exporter subject to stipulated conditions. Notification No. 5/2006-CE (NT) dated 14.03.2006 provides the conditions, safeguards and limitations for obtaining refund of such credit.
A job worker is engaged in processing material, supplied by principal manufacturers on job work basis. Such job work is covered under Business auxiliary service attracting service tax, when the process does not amount to manufacture. However, Notification 8/2005-S.T. dated 01.03.2005 exempt such job work on the condition that the processed material is returned to the principal manufacturer for further manufacture, on which finally duty is payable.
Once the taxable service is exported and various input services have been utilized for providing the output service :i.e. appellants could be entitled for the rebate, which is equal to the service tax paid on the input services. Going by the definition of the input service under Rule 2(1) of the Cenvat Credit Rules, 2004 the service utilized by the appellants for providing output service can indeed be considered as input services.
Rule 6 of CCR deals with the Cenvat Credit provisions in case of manufacturer of both dutiable and exempted goods (hereinafter referred as said manufacturer). Sub rule 1 to this rule says that credit is not allowed on that much portion of the inputs/input services that are used for manufacture of exempted goods. Sub rule 2 prescribes that credit will be allowed on common inputs/input services if the said manufacturer maintains separate records for inputs/input services used in manufacture of both dutiable and exempted goods.
In a recent landmark judgement in Coca Cola India Pvt. Ltd. vs. Commissioner of Central Excise (2009-VIL-06-HC-BOM-ST), the Mumbai High Court has interpreted the relevant provisions of service tax law in a broad and inclusive manner in order to hold that expenses incurred by a company in relation to advertising and promoting a brand owned […]
The services availed by a manufacturer for outward transportation of final products from the place of removal should be treated as an input service in terms of Rule 2(1)(ii) of the Cenvat Credit Rules, 2004 and thereby enabling the manufacturer to take credit of the service tax paid on the value of such services.
Trade Notice No. 14/2009 Prior to 01.04.2008 [before the amendment in Rule 6(3)] the option available to the taxpayer, under Rule 6(3), was that, he was allowed to utilize credit only to the extent of an amount not exceeding 20% of the amount of service tax payable on taxable output service. However, there was no restriction in taking CENVAT credit and also there was no provision about the periodic lapse of balance credit. This resulted in accumulation of credit in many cases.
